Pertambangan

Copper gained for a second day in London on speculation that a labor dispute at a mine in Chile, the world’s largest producer of the metal, may disrupt supply.

A union at the Cerro Colorado copper mine voted yesterday to strike as part of wage negotiations with BHP Billiton Ltd., the world’s biggest mining company. Supply disruptions last year helped drive copper futures to a record $8,800 a ton in May.

“The news of potential supply disruption at Colorado is giving copper some support,” said Peter McKie, a trader at Natexis Commodity Markets Ltd., one of 11 companies trading on the floor of the London Metal Exchange. “It’s probably not a big enough disruption to provide long-term support,” he said in a telephone interview.

Copper for delivery in three months on the LME gained $60, or 1.1 percent, to $5,700 a metric ton as of 12:45 p.m. local time. The metal 35 percent since the May 11 record.

UBS AG, Europe’s largest bank by assets, lowered its 2007 price forecast for copper by 8 percent today after dropping 10 percent in January. Copper will average $3 a pound ($6,614 a metric ton) this year, the Zurich-based bank said in a report. Last year, the bank said copper would average $3.25 a pound.

Housing Slowdown

Copper’s has declined amid expectations a housing slowdown in the U.S., the world’s second-largest user of the metal, will continue to reduce demand this year. A 14 percent drop in usage in the U.S. in the 10 months to October contributed to a global oversupply during the period, the Lisbon-based International Copper Study Group said Jan. 18.

Inventories of copper monitored by the LME increased 1,425 tons to 211,825 tons, the exchange said in a daily report, taking this month’s increase to 16 percent. Stockpiles in U.S. warehouses were 92,450 tons, or 44 percent of all LME-monitored metal. At the beginning of 2005, U.S. warehouses monitored by the LME contained less than 1,000 tons of copper.

Weaker Demand

The increase in U.S. stockpiles “reflected the weaker demand for copper there,” Norddeutsche Affinerie AG, Europe’s largest copper refiner, said today in a statement accompanying fiscal first-quarter results.

The U.S. economy probably grew at an annual rate of 3 percent in the fourth quarter, according to the median estimate of 77 economists in a Bloomberg News survey. The Commerce Department is scheduled to release the gross domestic product report at 8:30 a.m. in Washington today.

Nickel gained after posting the largest one-day decline in three weeks yesterday. Today is the deadline for Xstrata Plc to reach an agreement with a union representing 1,027 workers at its Sudbury unit in Canada, or face a strike.

The company offered the union a revised proposal, Richard Paquin, lead negotiator for the Canadian Auto Workers union, said yesterday, without giving details.

Strike Preparation

Unionized workers began preparing yesterday for a walkout by setting up trailers at entrances to mines and stocking up firewood. Local temperatures plunged to minus 24 degrees Celsius (minus 11 degrees Fahrenheit) this week.

The CAW workers have staged strikes twice since 2000, shutting down production for seven months in 2000 and 2001, and for three weeks in 2004.

Nickel gained as much as $1,100, or 3.1 percent, to $36,800 a ton.

Also on the LME, aluminum advanced $32 to $2,728, tin rose $145 to $12,200 and zinc gained $65 to $3,455. Lead added $32 to $1,692.

Source: www.bloomberg.com